Profits taken now an SPX trade

The markets were hit big today, so now is the time to place a quick trade on the SPX using our resistance points as a guide.

The SPX has a strong resistance at 1445 and even though it is in an uptrend, now would be a good time to take advantage of today’s drop.

Currently the SPX closed at 1423 very near the weak support of 1420. I would expect a bounce tomorrow morning so we should get a fill on this trade.

A Bear Call Spread - sell the FEB SPX 1450/1455 for a credit of 1.00 or if you want to be extra cautious try the 1460/1465 level for .50 credit.

We would sell the FEB SPX 1450 call for $3.40 and buy the SPX 1455 call for $2.40 for a credit of $1.00 if the Index closes below this level at expiration we receive the full credit. This gives us a profit of 20%, a risk of $400 per contract with a profit of $100 per contract.

OR… we would sell the FEB SPX 1460 call for $1.50 and buy the FEB SPX 1465 for $1.00. If the index closes below 1460 after 20 days then we receive the full credit of .50 or a 10% profit in 20 days, but we are risking $450 per contract.

Easy trade with a high probability of success.

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